Ten medical expenses you didn't know were tax deductible
A version of this commentary was published in the Globe and Mail
As Canadians we like to take pride in our publicly funded healthcare system, but the truth is many of us – especially those with or caring for someone with disabilities or chronic conditions – pay out of pocket for a wide range of essential health services. Studies show Canadians pay as much as 30 percent of our health needs privately.
Health costs that most Canadians bear privately include prescription glasses, dental care and most medications because these are not included in the Canada Health Act, which guarantees essential physician and hospital services only.
But those are just the obvious out-of-pocket health costs -- there are many ‘hidden’ health costs too, related to specific therapies, medical devices or social and educational services and supports.
Thankfully many of these are permitted medical expenses under the Canada Revenue Agency and can quality for tax deductions. A few eligible expenses might even surprise you.
If you or your dependent traveled more than 40 kilometres from home for medical services, and the equivalent services were not available near you, you may be able to deduct these costs – even for costs incurred outside of Canada. The expenses of a necessary travel companion (attendant) could also be eligible.
2. Training and respite
If you need to learn how to care for a dependent with a physical or mental impairment, the costs of training for you or a relative are eligible.
Those requiring respite or attendant care, full or part-time, can include expenses for food preparation, housekeeping, laundry services and transportation whether they are provided in a private facility or in your home.
3. School and tutoring
All personnel, equipment and facility costs associated with a school for those with a physical or mental impairment are deductible.
Similarly, the costs of a tutor for those with a learning disability or an impairment of mental functions is an eligible expense.
4. Talking textbooks, reading services, symbol boards
A student with a perceptual disability in secondary school may be eligible to have their talking textbooks included as medical expenses, as are reading services for those who are blind or have a severe learning disability.
Also devices for those with a speech disorder or impairment, such as altered auditory feedback devices or symbol boards, are eligible expenses.
5. Service animals
The cost of a specially trained animal to help someone who is blind, deaf, has severe and prolonged physical impairment, has autism, epilepsy or diabetes may be eligible – but only from recognized providers. This includes the cost of the animal and their care and maintenance, such as food and veterinarian care. Training to learn how to use a services animal is also included.
6. Therapy and therapy plan
The costs associated with creating a personal therapy plan and the costs of therapy for someone with a mental or physical impairment are eligible expenses. This includes services provided by a psychologist or occupational therapist, for example.
Diapers or disposable briefs for someone who is incontinent can be included.
8. Medical Marijuana
You have to be authorized to use medical marijuana for medical purposes, and purchase it from a designated producer, but it’s eligible.
9. Gluten-free products
The difference in cost between non-gluten-free products and gluten-free products is tax deductible – but only if you have celiac disease.
10. Construction and renovation
Some construction costs to renovate your home are covered for those with severe and prolonged mobility impairment. Examples include costs for building ramps, enlarging halls or lowering cabinets, as well as driveway access.
Other home related eligible expenses – depending on the health condition -- could include the costs associated with an electric or sealed combustion furnace, air filter, cleaner or purifier and air conditioner.
Unfortunately there’s one major cost that’s not covered: Over-the-counter medications, vitamins or supplements, even if prescribed by a doctor (except vitamin B12 for pernicious anaemia).
You can see the full list of eligible medical expenses and the amount you can claim on the Canada Revenue site in a new (2015) easy to read guide.
But beware: most of the eligible expenses listed above require a prescription and/or certification in writing from a medical practitioner before they can be eligible, some are only deductible for specific conditions, you can’t have been reimbursed for the expenses elsewhere – and keep your receipts, of course.
A few medical expenses also require eligibility first under the Disability Tax Credit (DTC). The DTC is something you have to apply for beforeyou do your taxes. It functions as a credit, reducing the amount of income tax you may have to pay regardless of out of pocket medical expenses.
The DTC is overdue for an overhaul – it’s complex, bureaucratic and fewer than half of Canadians who are eligible for it bother to claim it, which is a shame. But the DTCA tax relief can be substantial with possible other benefits, such as eligibility for the Registered Disability Savings Plan and other provincial credits kicking in, so it’s well worth looking into for those with or caring for someone with a long-term disability or chronic condition.